LONDON, England — In an interview with The Borgen Project, Ryan Thompson, a former management consultant, delves into the government’s process of creating and evaluating foreign aid policies. Most of Thompson’s work as a former management consultant with Strategy& (a part of the PwC network) was in the international development team. This role involved working with U.K. government foreign aid departments to understand how the state spent its resources and evaluate whether its foreign aid commitments made a practical difference.
How Governments Form Public Policy on Foreign Aid
“Most of the public spending is set at the central government level. Public policy can split into two categories: reactive policy versus proactive policy.” Thompson explained, “Reactive policy responds to what is happening right now, whereas proactive policy is preventative.” Reactive policy dominates political agendas, as governments need to respond to issues that occur during their tenure.
Thompson noted the current “digital financial inclusion” and technology-centered trends, which the pandemic accelerated and remarked how girls’ education was the focus before technology. The U.K. government, for example, pledged £100 million to fund education programs for girls in 2016, when girls’ education had gained strong political salience following Malala Yousafzai’s rise in mainstream media
Yet the government’s 2021-26 program now groups investments in education with all other official development assistance (ODA) efforts and does not specify which part of the budget will go toward education.
Moreover, the ODA program assumes that the U.K. government will be on track to undo its 2021 post-temporary pandemic reduction of ODA commitment from 0.7% of GNI to 0.5%. However, it is unlikely ODA spending will pass the fiscal criteria required to increase the budget before 2024.
Though external factors may be the easiest way to convince governments to invest in foreign aid, the way that governments present foreign aid to the public can shift the political discourse toward proactive policy. Thompson highlighted that “pushing the narrative that raising the playing field for everybody, rather than just your country, is actually good for you and for the rest of the world – that it’s a win-win.” This mutual benefit narrative tends to help convince individuals to support investing in foreign aid.
Although investing in foreign aid is challenging, once a government begins an initiative, it is difficult to end it. “Timing is important as well. It’s normally quite hard to go back on a commitment unless there’s really strong evidence to suggest that that’s a complete waste of money. So if a new government comes in and there’s still three years out of a five-year initiative, it’s quite hard for them to stop it.”
Evaluating foreign aid’s impacts in Tennessee provides an example of foreign aid’s mutual benefit. In 2014, the state exported more than $33 billion in goods and services to foreign markets. As a result, trade supported over 830,000 local jobs.
Nations also gain economic benefits from other G20 states by investing in foreign aid. A 2018 report by the British Council found that the U.K.’s investment in foreign aid was the prevalent reason young citizens trusted the U.K. Government. This soft power yields economic benefits: when G20 nations increase their trust in each other, they enhance their trade. Indeed, an increase in trust by 15% is correlated with a 1% increase in GDP.
Monitoring and Evaluating Foreign Aid Progress
Usually, policymakers observe the impacts of foreign aid in the long term. How do governments begin evaluating foreign aid initiatives to see if they are progressing successfully?
Drawing on his background in evidence-based social intervention and policy evaluation, Thompson explained how social scientists use theoretical work from research to generate empirical data. Experimental design, randomized trials, and control groups contribute to evaluating foreign aid commitments’ progress.
“Theory-based designs allow organizers to map out the expected short, medium and long-term results of an initiative. Then they measure the results compared to the timeline,” explained Thompson. “The timeline comparison is complemented with in-person monitoring groups that observe that the initiative is being delivered well. But it’s tough – there are trade-offs that organizations and governments need to make in terms of budget and collecting evidence, which is costly. So it’s a question of finding that balance”.
Understanding Methods to Build Trust in Foreign Aid
Politicians must see that their constituents care about the topic to get an issue on the political agenda. Once a government commits to a foreign aid initiative, the state takes measures to monitor the effort closely and to ensure that it is effective.
– Elena Sofia Massacesi